NYC Economy "Rapidly Deteriorating," Comptroller Says

New York City's budget gap will be as much as $1.9 billion in fiscal 2009 and could possibly balloon to as much as $5 billion by 2011, according to a wholly depressing new report from City Comptroller (and mayoral hopeful) William Thompson Jr. Is it okay to just go back to bed and pretend this isn't happening? Certainly, but the report's disheartening data will still be there tomorrow morning: The recession could cost the city some $935 million in tax revenues next year, a figure that includes a $525 million shortfall in real estate-related taxes, a $345 million reduction in personal income and business taxes, and a $65 million loss in property taxes.

The annual report, titled The State of the City’s Economy and Finances (Or, Time To Move Back In With Your Parents), paints an even bleaker picture than Mayor Bloomberg's November budget proposal. In it, Thompson writes, "Waves of negative economic developments during 2008 have given way to a tsunami of financial anxiety and caused us to issue a more pessimistic forecast than was put forth by the mayor. As the economy erodes, the outlook for New York City’s fiscal future will continue to change."

And when it comes to jobs, "a negative trend has become unmistakable," as evinced by the above chart. According to Crain's, Thompson's analysis "comes less than two weeks after the comptroller predicted 170,000 job losses citywide as a result of the financial crisis." Ever the downer, he predicts the city’s unemployment rate will soon hit 7.4%. Here's a PDF of excerpts from the report. Alternatively, you could just watch The Return of the Box Surfing Cat.